TJ Maxx Must Face Deceptive ‘Compare At’ Pricing Class Action Lawsuit

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TJ Maxx must face a class action lawsuit alleging the chain’s “compare at” pricing is misleading consumers about the actual prices of comparable items at other stores, a California federal judge has ordered.

TJ Maxx motioned to dismiss the proposed consumer class action lawsuit, arguing the plaintiffs lack standing to pursue their claims.

But last Thursday, U.S. District Court Judge Otis D. Wright II denied TJ Maxx’s request, including several quotes and phrases in his order referencing the 1987 film “The Princess Bride,” even prefacing his ruling with a quote from the movie, “You keep using that word. I don’t think it means what you think it means.”

In his 26-page order, Judge Wright stated that the plaintiffs sufficiently presented claims under California’s Unfair Competition and False Advertising laws by adequately alleging that the “compare at” price can likely deceive a reasonable consumer.

“Defendants’ game of relying on the plain meaning of the ‘compare at’ phrase to get people to shop at its stores while also claiming that the phrase’s definition is, in fact, qualified beyond recognition is not very sportsmanlike,” Judge Wright wrote, before adding another quote from The Princess Bride. “Anyone who says differently is selling something.”

In July 2015, two California residents, Staci Chester and Daniel Friedman who were later joined by Robin Berkoff and Theresa Metoyer, also of California, sued TJ Maxx for allegedly using deceptive and illegal comparative pricing on merchandise in its stores.

The plaintiffs filed the class action lawsuit over TJ Maxx’s use of the phrase “compare at” on the price tags of many name brand items.

The complaint says the retailer is using estimates of comparative items that misleads customers about discounts and not actual prices of the same product at another retailers or to an earlier price at TJ Maxx, which they claim violates California consumer protection laws.

TJ Maxx, the class action lawsuit claims, uses “deceptive comparative prices to trick its customers into mistakenly believing they are saving specific and substantial amounts on name brand items.”

But TJ Maxx argued in its motion to dismiss that shoppers should assume that the “compare at” price has some basis and that the discount chain is within its rights under FTC guidelines to offer price comparisons between one item and another of comparable value, based on good faith estimates.

However, Judge Wright disagreed saying that FTC guidelines clearly state that comparisons must be made on actual prices and not “estimates” of prices at which “a comparable item” in another store “may” have been sold.

“It is inconceivable to think prospective relief in the false advertising context is bound by the rules of ‘fool me once, shame on you; fool me twice, shame on me,'” Judge Wright said. “This court will not, as defendants wish, sound the death knell over California’s consumer protection scheme.”

The plaintiffs are represented by Christopher J. Morosoff of the Law Offices of Christopher J. Morosoff, Douglas Caiafa of Douglas Caiafa APC, and Michael G. Dawson and Greg K. Hafif of the Law Offices of Herbert Hafif.

The TJ Maxx Deceptive Pricing Class Action Lawsuit is Chester, et al. v. The TJX Cos. Inc., et al., Case No. 5:15-cv-01437, in the U.S. District Court for the Central District of California.

UPDATE: On Sept. 19, 2017, a proposed $8.5 million class action settlement over allegations TJ Maxx, HomeGoods and Marshalls stores use misleading price tags should be preliminarily approved, four plaintiffs urged a California federal judge.

UPDATE 2: January 2018, the California T.J. Maxx, Marshalls, HomeGoods deceptive pricing class action settlement is now open. Click here to file a claim.

UPDATE 3: On Dec. 3, 2018, Top Class Actions readers started receiving gift cards worth as much as $27.53 from the TJ Maxx, Marshalls, & HomeGoods deceptive pricing settlement.